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Archive for August, 2009

C4CNavajo, or Dine -they call themselves, is the largest tribe of North American Indians.  They used sheep for its wool to make clothes, blankets, and rugs.  They also used the sheep for food.  They traveled by horse back on long distances to trade.  Then Navajo began making items to trade in towns.  There were also trading posts built on reservations to sell their handmade crafts, such as pottery and blankets which continues to this day.

But, I’m talking about the Indian Motorcycle “trading post”.

The “trading” started with the “It Pays to Ride” promotion where you could purchase a 2009 Indian motorcycle and the company would pay the first 6 months of your payments up to $500/month. Basically it’s a $3000 discount (at the $500/month maximum) off the purchase of a new Indian motorcycle.  Now they’ve taken a page from the “Cash-for-Clunker” (C4C) program and in the process Indian out markets Harley-Davidson!  Bring in any motorcycle** and get $3000 trade on the 2009 Indian Chief model.  **The trade in must be street legal, 100 cc or larger and in running and ride able condition.  No mopeds, scooters or dirt bikes and must have a clear title.

The good news here is that taxpayer money will NOT be used to enable the dealers to offer discounts off sticker prices to extract higher profit margins.  I think this is smart marketing on Indian’s part and will likely boost the number of consumers visiting Indian motorcycle dealers.  I’m very doubtful that consumers will buy comparable quantities to the automotive program, but some new motorcycles will be sold to consumers who thought they had a motorcycle clunker to trade in.

Photo courtesy of Indian Motorcycle.

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LosersAssemblywoman Dede Scozzafava proclaims that Harley-Davidson would see similar results, like those of Advanced Micro Devices (AMD) if they were to relocate the Pennsylvania manufacturing plant to upstate New York.

Scozzafava wrote a letter to Matt Levatich, H-D president and COO, citing all the strengths including skilled workforce, college network, low-cost power and economic incentives as reason to give the area consideration.  She cited AMD as the poster-child of “success.”  The NY Public Authorities Control Board offered up incentives to the tune of $1.2B with a combination of tax breaks and a $650M grant to entice AMD to commit to a $4.6B ‘chip fab’ in Malta/Saratoga Springs that is expected to come on line in 2012 and employ ~1500 people.

Well, Ms Scozzafava if you’d done “The Google” you would have noticed that AMD has consistently lost money, for so long in fact that AMD spinners now report “profitability” as losing less than the year before!  Pink slips have become more common than “Good Morning” emails!  They are burning cash and bleeding personnel.  So much so that it lead AMD to hold a smaller than expected stake in the NY fab and the creation of a joint venture with Advanced Technology Investment, the government of Abu Dhabi which is capitalized by crude oil.

Cheerleading by the hometown assemblywoman isn’t too surprising, but does she really think H-D wants to co-locate and model success after AMD results?  They have had numerous product introduction slips, 11 straight unprofitable quarters, deep employee cuts for so-called “profitability”, off-shored manufacturing to Dresden, Singapore and Malaysia and now have the Arab government as investment partner.   About the only thing AMD seems to win in is legal litigation.

I noticed that Ms Scozzafava didn’t suggest for H-D to co-locate and take a page from IBM – who took taxpayer assistance ($140M), cut employees and moved jobs overseas.  Experience should teach us about the danger of a bureaucrats zeal — well-meaning but without understanding.

Photo courtesy of Andy Diggle and DC Comics.

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Concert In The Park

Concert In The Park

Do you feel it?  The smell of fall as the lazy, hazy days of sunshine dwindle faster than a Harley-Davidson financial comeback.

Too soon the leaves will fall, rain will flood the roads and snow will fill the air as television news canvas the area to report fender-benders over and over.  Before this happens, however, there is still time to ask: “Am I making the most of my 2009 summer riding season?”

In trying to stretch out summer as much as possible I attended an outdoor concert last night.  Was it motorcycle exhaust fumes mixed with cigar smoke and classic rock music like Summerfest in Milwaukee?   No, but Body & Soul reunited last night to perform high-energy Tower of Power, Chaka Khan, Stevie Wonder and classic rock.

Speaking of classic rock,  I’m not talking about Steppenwolf’s “Born to be Wild” or Springsteen’s “Born in the USA”, rather it’s about Steely Dan and “My Old School.”  Remember it was the “boomers” who grew up with music at the center of their lives.  There were no cell phones, there was no Facebook.  They lived to twist the AM dial in the coupe, if lucky had a FM radio and a phone in their bedroom.  The glue that kept them together was the music.  They call this music “classic rock”.  Classic, as in aged, as in done.  But, I beg to differ.

Body & Soul Music Group

Body & Soul Music Group

Insiders will tell you the best Steely Dan album was the second, “Countdown To Ecstasy“, the one that ended their touring career, the one sans any hits.  I disagree. It was “Can’t Buy A Thrill” which was truly a masterpiece.   At the concert last night Body & Soul performed “My Old School” and hearing those guitar riffs made me want to blog about it.

For the uninitiated, or those who grew up in the mid-west, or even further left, Annandale-on-Hudson is the location of Bard College, where those who were smart, but thought high school was B.S and didn’t have the grades commensurate with their intelligence ended up going to college to further their creativity.  It’s where Walter Becker and Donald Fagen went to school before moving on to back up Jay Black as two of his Americans and ultimately getting a deal with ABC Records.  They were forced to get a lead singer, David Palmer, since Fagen’s voice was “supposedly” deemed not radio-ready by the studio execs.  Mr. Palmer sang the lead vocal on a legendary track, but I like this version of “Dirty Work” however, when performed live it hasn’t got the same power with backup singers taking the lead.

SDAfter struggling in the music trenches for years, plying their trade far from the spotlight, Steely Dan became a success and was an AM radio fixture.  Not an FM staple.  Remember back… FM was in the process of getting dumbed down, featuring meat and potatoes rock as opposed to intelligence, but when the hooks of “Do It Again” and “Reelin’ In The Years” poured out of one speaker it could not be denied by AM radio and the album “Can’t Buy A Thrill” became a huge hit.  It was an album seen most often in dorm rooms of those not quite hip, but didn’t have to worry about their cred.

For those of us who lived through it, when we hear Steely Dan songs we’re brought right back.  I’ve seen Becker and Fagen at the Gorge Amphitheatre a couple of times.   Their troupe of hired musicians return us to what was and who we used to be.  And one could say it was aged music, but like wine, some things get even better as the years go by.

Even though youngsters these days might not understand, they positively get awesome musicianship.  It’s not about staging or production it’s about the music. Yes, the sun is setting on these baby boomer acts.  Their audience is getting older, fans don’t feel the same need to go to the show.  But if you’re a musician you play anyway.  That’s what you’re in it for, the SOUND!

Steely Dan and Body & Soul photos courtesy of respective web sites.

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Health_CareAs a motorcycle enthusiasts should we care about the Healthcare debate?  In a word, YES!

Looking in our rear view mirror, there is precedent for all of us to be concerned with in regards to any health care legislation coming out of Washington. For example in 1996, Congress passed the Health Insurance Portability and Accountability Act (HIPAA) that was intended to ensure non-discrimination in health coverage in the group market. However, when it came to implementing the law, the Department of Labor, the Internal Revenue Service and the Health Care Financing Administration – now the Centers for Medicare and Medicaid Services – issued a rule allowing insurers to deny health benefits for an otherwise covered injury that results from certain types of recreational activities, such as skiing, horseback riding, snowmobiling or motorcycling. Even though many motorcycle friendly organizations (ABATE, AMA, etc.,) have fought this discriminatory rule with legislation, it’s a clear indicator of what can happen if a new health care bill is implemented by bureaucrats in Washington using biased data.

More information can be obtained HERE on injury exclusions as each state has unique implementations.  In some cases state law compliments HIPAA.

Generically speaking, the most simple answer is for motorcycle enthusiasts to oppose any legislation that may come from the new healthcare debate which restricts the freedoms of riders who enjoy an active lifestyle.  We cannot allow our elected officials to abdicate the rights of the insured to an unelected commission or board, which will render final decisions regarding appropriate medical coverage for individuals who ride motorcycles as a mode of transportation or for recreation (e.g., denial of a procedure).

If this issue resonates with you, below is a form letter to mail to your state reps for reference:

[Your Name]
[Street Address]
[City, State, Zip Code]

August 27, 2009

Note: In Oregon write to all three:

The Honorable Jeff Merkley
United States Senate
107 Russell Senate Office Building
Washington, DC 20510-3704

The Honorable Ron Wyden
United States Senate
223 Dirksen Senate Office Building
Washington, DC 20510-3703

The Honorable Kurt Schrader
House of Representatives
1419 Longworth House Office Building
Washington, DC 20515-3705

Re: Motorcyclists Express Concern with Health Care Debate

Dear Senator [NAME]:

As a constituent and riding enthusiast, I urge you not to include anything in the various health care bills that may adversely affect my ability to ride a motorcycle.  I am opposed to any legislation that may inhibit the freedoms of riders, including myself, from enjoying an active lifestyle.

I value personal freedom and responsibility when it comes to enjoying my passion for riding. As you continue your deliberations on health care reform, please do not abdicate the rights of the insured to an unelected commission or board which will render final decisions regarding medical coverage for those of us who ride as a mode of transportation or for recreation. Please ensure that I will continue to be able to pursue my chosen recreational pursuit without the addition of unneeded prohibitions, limitations or mandates stemming from the health care legislation under consideration.

Again, I urge you to protect my freedoms from being dictated to by an unelected commission or board in determining medical coverage for individuals who ride.

Thank you for your time and consideration of this important issue.

Sincerely,
[Your Name]

We need to write our government representatives and voice our concerns regarding the various health care bills to ensure that motorcyclists can chose a recreational pursuit without the addition of unneeded limitations or mandates stemming from any health care legislation being considered.

Photo courtesy of Masscare.org

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EmpireOnce upon a time, a century or so ago, there was actually a shortage of information.  In small towns, people would even interrogate strangers passing through just to find out what was going on in the world.  Those days are long gone and today we have the reverse problem.  There is too much information.

Which brings up Mr. Bogdan Bucurescu, managing director of Harley-Davidson Bucharest, who put out a press release announcing the dealer sold sixteen (16) motorcycles year to date!  Is this what it’s come too?  Motorcycle sales so pitiful that you need to tell the world you’ve garnered a 20% market segment share in a market which dropped 75% — and then explain it as a good result!  Talk about spin.  In 2008, Automotive Trading Services (ATS), the importer of H-D and Buell motorcycles announced that Romania sold 80 motorcycles.  Clearly sales are off this year and using a press release to show “upside” is nothing but a distraction from the bigger picture.

This trend reminds me of a parallel in the music industry where we’ve got aging superstars, overcharging to fewer and fewer people.  And at the other end of the spectrum we’ve got the Top Forty wonders, making ever more boring records for a shrinking market.  At the current Bucharest dealer sales pace will it be long before we read a press release stating 100% market segment share from ZERO sales?   There must be some new type of business model in Romania which enables a dealer to make money with NO sales?!

Back to sixteen… Huh?  A city with 1.9 million people!  Doesn’t that seem low?  Just four months ago the sales manager, Marcel Chiva made projections of selling one motorcycle a week with plans to remain in the top 3 motorcycle manufactures in the above 650cc segment.

With little effort it’s easy to learn that Romania, a communist country until 1989, has the 7th largest population (with 21.5 million people) among the European Union (EU) member states.  Its capital and largest city is Bucharest, the 6th largest city in the EU.  Bucharest is also the center of the Romanian economy, accounting for around 14% of the country’s GDP and about one-quarter of its industrial production. Almost one third of national taxes is paid by Bucharest’s citizens and companies.  Add this to the fact that Romania has a large, upper-middle-income economy, the 15th largest in Europe based on purchasing power parity and the center of Romanian media (read advertising), since it is the headquarters of all the national television networks as well as national newspapers and radio stations… it seems the country’s economic growth is out of sync with motorcycle consumption and no matter how many times I punch in the data on my trusty Tandy desk calculator, it just doesn’t add up.

Despite my bit of Romania/Bucharest boosterism, H-D’s use of fringe markets to project trivial news is a distraction and contributes to information overload.  And yes I’m guilty of finding unusual angles on stories that everyone else is missing.

Photo courtesy of H-D.

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Nike Clothing Exit -- Abdel Basset Ali al-Megrahi

Nike Exit -- Abdel Basset Ali al-Megrahi

According to miss-placed sources the Nike endorsement scouts have frantically been working to strike deals with high profile Scottish “residents” for a new line of casual wear.

The new ad campaign titled “Compassionate Wear: For Those Making A Fast Exit” pitches a 30-second TV commercial that depicts an ailing individual who is released from a “solitary village” in tourism clothing; (white) running shellsuit, prominent black-on-white “Swoosh” baseball cap, and walking trainers.  This new “Compassionate Wear” campaign was first rolled out last week with celeb Abdel Basset Ali al-Megrahi,  the terrorist who killed 270 (most who were Americans) in the 1988 Pan Am flight over Lockerbie Scotland and was recently returned to a hero’s welcome in Libya after only serving 8 years of a life sentence.  His compassionate release by Mr. MacAskill was due to “so-called” final stages of prostate cancer and having less than 3 months to live.

According to my Nike sources who never attended the unveiling, the new “Compassionate Wear” clothing line needed to send a powerful association message of being “FAST” even as relaxed tourism casual wear.  Ideas by Nike marketing were bullets, airplanes, camera flashes, really fast dogs, and other athletes who walked counterclockwise to turn back time.  In fact, the marketing rep reportedly said the words “fast” and “really fast” more than 72 times per minute.  They also described the use of a Harley-Davidson motorcycle in some of the upcoming commercials to leave burn-out tire marks on the road with tiny flames coming out of them. Fire equals fast…  Other concepts bantered around was something about an exploding stopwatch which was clearly ill-conceived as they were caught off guard by the obvious bomber correlation.

Boycott Motorcycle Scotland

Boycott Motorcycle Scotland

All humor aside — although completely implausible and actually quite offensive, I’m sure Nike wasn’t satisfied with a direct link to the Scottish judicial system and the Lockerbie bomber.  What?  The same company that aggressively fights any sweat shop image worry about poisoned relations due to the Lockerbie bombers high profile release in their logo?   Right!  Would love to have read that letter from Mr. Phil Knight.

The release was wholly wrong and my suggestion is to boycott Scotland.  Tourism and whisky are two of the major economic ties to Scotland.  Each year more than 340,000 Americans visit Scotland – one out of every five – and in aggregate spend more than $425M per year.  Don’t motorcycle Scotland, read Robert Burns poetry, download music or golf the pristine courses.  And don’t purchase their whiskey.  There is a group called “Boycott Scotland” or you can email Mr. MacAskill HERE to directly voice your concerns/outrage.

I don’t know if the absence of Americans on their golf courses will have any impact on the economy, but making noise which reflects the public sentiment has shown in a number of instances to make a difference.

Photo courtesy of Danny Lawson, AFP/Getty.  Full Disclosure: I’m Irish, have no sources at Nike and Pendleton Whiskey is my new friend.

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2-Day_LaunchIn two days the Indian “Alphonso” mangoes will hit the U.S. supermarket shelves for the first time in 18 years!

I’m reminded of that Jimmy Buffett song “Last Mango in…”

I went down to Captain Tony’s to get out of the heat

When I hear a voice call out to me, “Son, come have a seat”

The “seat” in this case is attached to a Harley-Davidson.  In exchange for importing mangoes, H-D will be allowed to launch its 883 Sportster and Fatboy in the “land of a billion people” (a.k.a. India) on August 27th as long they comply with Euro-III emission norms. In a country that snaps up more than 6 million new motorcycles a year, H-D is a bit late to the party, but they have to be optimistic given the successes of Yamaha, Suzuki, Honda and Ducati “superbikes” (anything over 800cc are referred to superbike in India).  The bikes will be shipped to India and available as a CBUs (Completely Built Units).  Previously the Indian government had not specified emission standards for motorcycles over 500cc which effectively prohibited the import of H-D motorcycles who could not meet the standards set for scooters.

Speaking of standards…  I’m talking about a country that after more than six decades of independence, over 55% of the population (~660Million) defecate in the open! Given these statistics it’s no surprise the government was slow to specify emission standards on 500cc motorcycles when they clearly are busy with sanitation issues.

New Deli Traffic

New Deli Traffic

Until this week Royal Enfield (owned by Eicher Group) was the only motorcycle maker to offer cruisers in India.  Consistently large orders from the Indian government led to establishing a factory back in 1955 in the town of Chennai, India.  Even after production stopped in England they continued in Chennai.  Here is a 5 min video of them building a motorcycle.  There seems to be a fondness of following the old British tradition and use of a mallet to assist in the precision parts fitting!

Anyone who has visited India knows that the large cities of New Deli, Bangalore, Hyderabad, or Mumbai have traffic that defies amazing.  It’s extremely densely packed roads with stop-n-go vehicles and engines idling most all of the time.  Then there are the rickshaws (phat-phatis), bicycles, jay-walkers, street-car peddlers, cows, donkey carts and at any given time each traffic lane supporting triple the number of vehicles that it should so, what you end up with is pure chaos.  Even with astronomically high traffic-death rates, scooters and motorcycles are the more practical method of getting around on these packed roads.

Matt Levatich, President and COO of Harley-Davison reportedly will be on hand at the launch and annual Society of Indian Automobile Manufacturers (SIAM) to welcome back H-D to India for the first time since World War II.  At that time thousands of motorcycles were shipped to the eastern Assam state of India with the intention of transporting men and deliver mail.

India is a prime target given the sheer market size and I want to wish them success as they work to diversify their revenue base.

Photo courtesy of H-D India and Flickr.

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